Bloomberg reported that Cnooc Ltd China biggest offshore energy explorer fell the most in more than two years in Hong Kong trading after forecasting slower production growth.

Cnooc said it plans to raise oil and gas production by as much as 12% in 2011 after paying about USD 8.4 billion for energy assets in Africa, Argentina and the US in the past year to bolster reserves. By contrast, the company output increased 44% in 2010.

Mr Cheng Khoo and Mr Gordon Wai analysts at Nomura International Ltd said “The 2011 strategy preview revealed a lower-than- anticipated production volume growth. This year’s volume growth is unlikely to excite especially as the growth will mainly come from its Argentina acquisition. The stock is unlikely to outperform.”

Overseas acquisitions in the past year included the USD 3.1 billion purchase of a 50% stake in Argentine producer Bridas Corp and the USD 1.08 billion acquisition of a share in Chesapeake Energy Corp Eagle Ford shale project in Texas.

According to Cnooc estimates most of Cnooc assets are off the Chinese coast where the company said it plans to start up four projects this year. Fields outside China may account for more than 20% of overall output this year and by 2015 more than 30%.

The mean estimate of 15 analysts surveyed by Bloomberg shows the Beijing based company may report profit rose 75% to CNY 51.5 billion last year. Net income may increase to CNY 58.6 billion this year.

Mr Gordon Kwan the head of regional energy research at Mirae Asset Securities Ltd said “With oil likely to average USD 100 this year versus USD 80 last year, Cnooc latest production growth guidance could translate to more record profits ahead. While some might view Cnooc growth target as a big slowdown don’t forget this is on top of a very high base in 2010 that saw over 44% jump in oil and gas output. Many global peers out there can only manage low single-digit production growth.”

(Sourced from Bloomberg)